By Nell Mackenzie and Summer Zhen
LONDON/HONG KONG, May 17 (Reuters) –Large global hedge funds extended their strong first quarter performance into April, despite it being a turbulent month for stock markets worldwide as they grapple with shifting monetary policy expectations.
Ken Griffin’s Citadel saw its Wellington Fund rise 2% in April, bringing its returns this year to 7.8%. Its other strategies, including a global equities strategy, also posted gains for April and the first four months, a source familiar with the matter said.
Rival Izzy Englander’s Millennium Managementwas up 1.1% in April and 4.8% so far this year, according to a note from HSBC Alternative Investment Group.Another multi-strategy hedge fund giant Schonfeld Strategic Advisors’s flagship fund ended April with gains of 0.5%, being up 6.8% year-to-date.
These funds did better than average. The HFRI Fund Weighted Composite Index, which tracks a range of hedge fund strategies globally, posted a 0.6% decline in April.
Equity hedge funds tracked by the data provider HFR fell 1.6% on average last month, indicating these big hedge fund players were better able to navigate the market downturn.
The S&P 500 .SPX was at the fore of a retreat in global equities in April, dropping 4%, as investors unwound crowded positions in large stocks and reduced risk-taking on concerns interest rates will stay high for longer and Middle East tensions will escalate.
Still, market volatility, such as the frequent disconnects between Wall Street’s performance and central banks’ policy signals, created opportunities for hedge funds that take both bullish and bearish positions.
“Managers in both credit and equities continue to benefit from increased dispersion as both inflation and rate expectations remain challenged,” Swiss private bank UBP said in a note.
Global distressed and discount bond trading fund Shiprock Capital Management returned 4.7% in April, taking returns so far this year to 18%.
Some investors capitalised on the rebound in the biggest U.S. stocks such as Nvidia NVDA.O and Amazon AMZN.O after a selloff.
New York-based multi-manager platform Cinctive was up about 2% in April and about 9% year-to-date, its performance driven mostly by stocks, including technology and financials, according to a source familiar with the matter.
In addition, a rally in commodities ranging from gold and oil to copper also boosted hedge fund performance, market participants said.
However, not all hedge funds had a good month. New York-based Exodus Point and London-based Marshall Wace’s flagship funds dropped 0.2% and 0.5% respectively in April but were up 1.9% and 7.4% respectively for the year so far, as per an investor letter and a source.
|
Hedge Funds |
Performance – April |
Performance – YTD |
|
Citadel Wellington |
2% |
7.8% |
|
Schonfeld Strategic Partners |
0.5% |
6.8% |
|
Millennium International |
1.1% |
4.8% |
|
Winton Multi-strategy fund |
1.2% |
10.3% |
|
Cinctive |
2% |
9% |
|
Exodus Point |
-0.2% |
1.9% |
|
Citadel Tactical Trading |
3.3% |
11.2% |
|
Citadel Global Equities |
3.3% |
9.9% |
|
Citadel Global Fixed Income |
flat |
2% |
|
Schonfeld Fundamental Equity |
0.2% |
6.2% |
|
Marshal Wace Eureka |
-0.5% |
7.4% |
|
Marshall Wace Market Neutral Tops |
1% |
8.8% |
|
Marshall Wace Global Opportunities |
-0.4% |
5.5% |
|
Winton Diversified Macro |
1.7% |
12.1% |
|
AQR Apex Strategy |
2.4% |
13.5% |
|
AQR Helix Strategy |
2.4% |
11.1% |
|
AQR Managed Futures Full Volatility |
3% |
21.1% |
|
Aspect Diversified |
1.7% |
21.8% |
|
Shiprock Capital |
4.7% |
18% |
|
Mulvaney Capital Management |
10.1% |
134.6% |
Reporting by Summer Zhen and Nell Mackenzie; additional reporting by Carolina Mandl
Writing by Summer Zhen: Editing by Vidya Ranganathan and Peter Graff